WhatsApp, Viber, Telegram and Snapchat are not like WeChat, LINE and KakaoTalk.
I’ve written about LINE and KakaoTalk but now it’s time to intro the last player – WeChat. WeChat is not – I repeat NOT anything like WhatsApp or Viber.
Aside from multi-media communication capabilities: photos, video, walkie-talkie and broadcast features, in August of 2013, WeChat completely overhauled their product with v5.1 to add a bunch of new features and functions.
They keep differentiating themselves from the rest of the chat apps and this is why:
- in-app payments
- P2P (peer to peer) and O2O (offline-online) core strategy aside from games <– HUGE
- multiple monetization streams
WeChat Payments connects bank card to WeChat account so users can make payments in-app.
Users can make transactions happen through 1. payments to WeChat authorized partner retailers 2. P2P (peer to peer) or in plain English other WeChat users – example: users can send one person a specified amount, or send money to a group and divide the lump sum among a group of friends. If I had a penny for every time I’ve had issues with group payments where one person pays too much, too little I’d have about four extra iPhones sitting around. Or think about that one person who never has cash, etc., etc. WeChat group payments is the perfect resolution for group events / activities.
O2O / P2P Commerce
WeChat also partnered with sites and services – whether through acquisitions or buying a stake in the company – doing flash sales or becoming the preferred payment partner. To date, DianPing – China’s answer to Yelp, with a Groupon type group buying feature DianPing also offers coupons and discounts and users can even order food for delivery – is one of the most notable.
The other is Didi Dache – China’s Uber – where users can order a taxi and make payments, all in-app. Since forming the partnership in Jan., WeChat reports
- 21mm cab rides have been booked via WeChat
- 700k daily bookings via WeChat
- Didi Dache and WeChat also pay cab drivers bonuses when the drivers use their services vs a competitor
WeChat also aggressively positions themselves as the entry point for global brands who want to reach China’s youths. Most recently, Vivienne Tam and WeChat collaborated to bring NYFW (NY Fashion Week) to WeChat users.
They’ve also done campaigns with Mc Donald’s, Starbucks, Burberry, Pepsi and Maybelline – bottom line, they are making money becoming a payment solution and by advertising as well.
Another monetization channel through partnerships is content. WeChat and Chinese media outlets bring news and entertainment to users. However, instead of solely bringing content into the app like Flipboard or Facebook’s Paper, they have their media partners build proprietary micro-sites into WeChat with proprietary URLs ie: mp.weixin.qq/majorchinesenetwork and charge users subscription fees.
They’ve also ventured into streaming video, launching a standalone TV with CNTV (major Chinese tv network).
If you think that’s all, they are also China’s small business e/m-commerce solution (like Etsy or even Amazon).
Small business accounts are
- free to create — fee is dependent on level of API customization and how much a business wants to integrate their products and services into WeChat
- transactions are conducted inside WeChat — which leads to increased time spent inside app
- bar-code scanner capabilities so people can scan a bar code in a store of something they see and shop for it online for example
- built in loyalty cards and point card systems
Major brands and retailers to even a college student with a fruit stand can buy and sell on WeChat – that’s how simple it is.
WeChat states they have 300mm active users per month and YoY growth of 124% (note: these numbers are before the Red Envelope campaign that reportedly activated 20mm transactions within 9 days and announcement of all their partnerships).
WeChat is not fucking around.
I’m sure there are so many more features and functions, products and services I may be missing. This is information I gathered through English sources (FT, Economist, WSJ, Techcrunch, The Next Web, Tech in Asia and some random Chinese sites I ran through Google Translate) but even if I don’t know all the details, it’s pretty clear they are one step above the rest of the chat app herd.
One can argue their success is due to the uniqueness of the Chinese market and how the economy is intertwined by a select few and with the government, but strip away all that noise and look at WeChat as a product. They are still several steps ahead of the rest — even LINE, that I am a massive fan of.
2014 is going to be a year to closely watch Asia.